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Embraer (ERJ) Posts Strong Q1 Deliveries; Backlog Up Y/Y

Brazil-based Embraer SA ERJ reported solid delivery figures for the first quarter of 2016. The company delivered a total of 44 jets in the quarter, up 37.5% year over year.

Deliveries to the commercial aviation and business aviation markets were 21 and 23 jets, respectively.

In comparison, in the first quarter of 2015, the company had delivered 20 jets to the commercial aviation market and 12 jets to the business aviation market. In total, the company reported deliveries of 32 jets during the quarter.

For the first quarter of 2016, under commercial aviation, Embraer supplied 19 E175s and 2 E195 jets. The rest were delivered to business aviation, which included 12 light and 11 large jets.

Embraer reported an order backlog of $21.9 billion as of Mar 31, 2016. Although this represents a 2.7% sequential decrease, the figure climbed 7.4% from $20.4 billion recorded a year ago.

The company also rolled out the first model of the second generation of the E-Jets family of commercial aircraft – the E190-E2. Moreover, Austrian Airlines started the integration of 17 used E195 jets in its fleet.

During the quarter, the company announced a partnership with Across for the sales of business jets in Mexico, which made the business aviation services provider an authorized sales representative of Embraer's full business jet portfolio across the Mexican market. Furthermore, according to the 2015 worldwide year-end aircraft shipment and billing report by the General Aviation Manufacturers Association, the Phenom 300 retained its position as the most-delivered business jet in the world for the third consecutive year.

This Zacks Rank #3 (Hold) company is the world's third-largest commercial aircraft manufacturer after The Boeing Co. BA and Airbus EADSY. The company designs, manufactures and sells aircraft and systems under both the commercial and executive aviation, and defense and security segments.

A Stock to Consider
    
A better-ranked stock in the aerospace and defense industry is Huntington Ingalls Industries, Inc. HII, with a Zacks Rank #1 (Strong Buy).

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